Gas and oil exploration group Bowleven is to raise about £70million through a placing of up to 22m new shares.

The Edinburgh-based AIM-listed company – which focuses on West Africa – said the placing represented some 11 per cent of the existing issued share capital.

The company said the cash raised would allow further exploration and appraisal work in offshore Cameroon.

On Thursday the company revealed that drilling on its Sapele-1 exploration well in the area had struck more oil – a discovery which it described as being “potentially transformational” for the business.

BowLeven shares closed on Thursday at a record high of 338p, valuing the group in total at just over £650 million.

In a statement Bowleven said the money from the placing would be used to fund more drilling on its section of the Douala Basin in Cameroon, which it says has been “relatively unexplored” in comparison to neighbouring West African countries.

“To fully evaluate and test the prospectivity of the Basin it is clear that extensive further exploration and appraisal activity is required.”

At the start of November the company announced positive results which showed the company had turned around last year’s $10.2 million loss into a profit of $19.5 million.